Did you know that the median inheritance is $69,000? And did you know that the average retired adult leaves behind anywhere from $296,000 to $383,000 in net wealth?
As you can see, if you’ve received an inheritance, you might have a good chunk of money. It might be even more that you’ve ever seen in your life!
So are you wondering what to do with an inheritance? Then read on. We’ll give you 5 tips you should keep in mind.
1. Pay Your Debts
The majority of Americans have debts. Whether it’s student loans, personal loans, or a mortgage, you probably have 1 or a few on this list.
When you receive an inheritance, one of the best things you can do is pay off as much of your debts as possible. If you can pay them off completely, or get way ahead in payments, this can save you a significant amount of money. This is because you pay less in interest.
2. Put the Money in a Savings Account
If you don’t have any debt, or you have money left over after paying it off, the next thing to do would be to put it into a savings account. This is a wise financial decision because not only will you accrue interest on it, but you’ll also be less tempted to use it. This can be especially true if you put it into an account that charges you a penalty for early withdrawals.
3. Speak With a Financial Advisor
Most people don’t really know how to manage their money wisely.
Are you someone who struggles with managing your money on a daily basis? Do you have trouble planning for the future financially? Then you could benefit from speaking with a financial advisor.
They can help you come up with a plan for both the short and long term. This will help ensure you don’t blow all your inheritance within a year or so. They’ll also make sure you’re on track when it comes to saving for retirement.
4. Invest Your Money
Do you want to make your money grow? Then you can invest it.
This is something you can talk about with your financial advisor, especially if you don’t know where to start with investing. Make sure you consult with someone who doesn’t take a commission!
5. Sell the Property
If you haven’t received a lump sum, but instead, some property, a good idea would be to sell an inherited house. In many cases, this is a lot simpler than trying to fix it up and/or living in it yourself.
By selling it as-is, you’ll be able to get cash for it in the near future. That way, you can use that money on things that are more pressing in your life.
Know What to Do With an Inheritance
Now you know what to do with an inheritance if you get one. No matter what you want to do, it’s always a good idea to speak with a financial advisor, as they have to the know-how on this exact subject. Together, you can decide what the best plan of action is for you.
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